Gloucester Coal ups sales, production

Gloucester Coal Ltd has increased its second-quarter sales and production, but is still feeling the effect of export delays at the Port of Newcastle.

The Hunter Valley-based coal miner said sales rose 10 per cent to 621,000 tonnes in the December quarter, but export volumes had been affected by the large shipping queue at Newcastle.

Vessels arriving in Newcastle after December 12 were not loaded until January.

“This delay represents approximately 10 per cent of the first half year’s sales,” the coal miner said.

“Some customers have elected to defer sales to 2007 rather than have vessels stand in the queue.”

Despite the delays, sales for the quarter were in line with the company’s expectations.

“The strong demand for Hunter Valley thermal coal (for power generation) is continuing to be reflected in the lengthy vessel queue, which at 31 December 2006 stood at approximately 50 vessels,” Gloucester said.

“Demurrage costs have increased as a result of the delays and are forecast to continue at higher levels through the third quarter of 2006/07.”

Gloucester Coal said open-cut operations were continuing to meet expectations, with total production of 548,000 tonnes for the December quarter compared to 480,000 tonnes for the December quarter in 2005.

“The Stratford preparation plant (in the Hunter Valley) also continues to meet the forecast production of 3.2 million tonnes per annum,” it said.

Last week Rio Tinto Ltd’s subsidiary Coal & Allied Industries Ltd warned that it expected its second-half profit to at least halve as shipping congestion at Newcastle raised operating costs.

Source: AAP News